TyroCity: Business Studies XI Notes

Concept of record management

Business Studies XI Notes — Sun, 18 Aug 2013 05:41:42 +0000

Concept of records
Records are the collective form of written data that are made for future use. They are the memory of the office record. Management is an art of handling and maintaining office records from the time of creation to the time of disposal. Office records are the informational documents used by the organization to carry out is major functions. It is also defines add the material and data prepared for future reference. It includes written papers, invoices, reports, vouchers, files etc.

Types of partners

Business Studies XI Notes — Sun, 18 Aug 2013 05:41:42 +0000

General partners:
They provide capital and play active part in business

Inactive partner:
They provide capital to business and share profit and loss to firm but do not take part in management and day to day activities.

Nominal partners:
They act only as a partner and give their name to the firm. They do not take part in management and day to day activities and share profit and loss to firm

Secret partner:
Their membership is kept secret to the outside world. They can take part in management

Partner in profit only:
They share profit only but no loss is shared. They are generally inactive but have relation in money and goodwill.

Minor partners:
They do not enter into contract and can’t be made partner in real sense but if there is consent of all partners then their partnership can be taken into consideration

Retrieval partners:
Even if this partner leaves the firm other partners continue to operate business. They are liable for all debtor and share profit too. But they do not take part in management and day to day activities.

Incoming partners:
If there is consent of all partners then their partnership can be taken into consideration. They aren’t held liable for debt before approval of all partners.

Concept of an office

Business Studies XI Notes — Sun, 18 Aug 2013 05:41:42 +0000

Definition of an office

Office is an important pace of the organization where different functions are performed to achieve the objectives of the organization. It is the integral part of any business. If business starts to be rigid and complex, office helps by simplifying the activities and promotes the expansion of business. It is set up to handle the information and daily transactions in s systematic way. The definition of office can be interpreted in two ways. They are traditional and modern viewpoint. In traditional view, office is defined as the place where clerical functions like receiving, recording, processing and supplying information are performed. In modern view it is defined as the part of organization which involves in performing all management as well as administrative functions such as planning, policy making, organizational activities, coordination and communicating in order to achieve the objectives of the organization.

Functions of an Office

Business Studies XI Notes — Sun, 18 Aug 2013 05:41:42 +0000

Functions of an office

Primary or basic functions
Auxiliary or administrative management functions

1. Primary or basic functions
An office basically performs those functions that are related to information management. It helps in receiving, recording, arranging, analyzing and transmitting information.

Receiving and collecting information
Receiving and collecting different types of information from the different types of sources is the primary function of an office. The information is received from two sources. They are internal and external. Letters, invoices, circulars, notices, memos are the internal sources and supplier, customers, government, banks are the external sources
Processing and arranging information
It is the most significant function of an office. The information collected and recorded cannot be readily used for the decision-making and other purposes in the organization. Therefore, it must be processes and arranged. Processing information involves preparing notes, sorting, editing t. all information are to be arranged in a systematic way.
Supplying information
After arranging and analyzing information it is ready to supply in the management. It provides necessary information to its member whenever it I required. This information helps in decision-making process.
Retention of records
Retention is defined as the preservation of records for future reference. It involves collection, preservation, classification and protection of records for future reference. It is maintained in files, computers etc. Every record has a life span. It is protected according to its importance. Retention of record depends upon nature of organization. The efficiency of office depends upon the way records are retained

2. Auxiliary or administrative management function

Management process
To make any business successful there must be good management. Office helps in effective management. It includes planning, organizing, staffing, directing and controlling. It helps in smooth functioning of the organization.
Public relations
There must be good public relation of the organization. The main purpose of public relation is to make the organization look trust worthy to all people who deal with it in all its action.
Development of office system and procedure
Every office develops a definite office system and a fixed routine. It helps in smooth flow of office work. The system is also known as procedure of office work.
Safe guarding the assets
All assets, movable and immovable, documents and office records must be guarded and protected. They can protest these assets through insurance policies, locker etc.
Form designing and control
An office designs, develops and prepares many types of form needed for office management. It helps to get maximum benefits. These office forms are important tools for collection and storage of information.
Purchasing stationery and supplies
Office stationery and supplies are essential for doing work. It helps in increasing the efficiency and improving quality of works done. Office should pay attention in purchasing right type of stationery and supplies
Purchasing office furniture and machine
Office requires various types of office furniture and machine for efficient performance. The quantity, quality, consistency and completeness of work basically depend upon the ability and quality if assets like office furniture and machine.
Personnel function
Office is also related to recruiting, training, placing, promoting the employees. Employees help in the success of the organization.

Concept of office management

Business Studies XI Notes — Sun, 18 Aug 2013 05:41:42 +0000

Office management is the process of planning, organizing, staffing, directing and controlling the administrative functions of an office in order to achieve the objectives of the organization. It is the process o utilizing the office resources efficiently o obtain the best result with less effort and cost. It helps in receiving, recording and processing, supplying and retaining information. It is the branch of management which deals with performance of these functions

Elements of office management

1. Personnel
An office provides wages, salaries to their employees. They also keep records of workers attendance, leave due, provident fund, and calculation of overtime. They also help to maintain the relationship between management and workers. It is the main element of office management. Success of office depends upon the employee.

2. Means
They are the tools which help to perform different activities efficiently. The means are material, methods, money and machines. They are vital for office works. Office must use right types of means. If office doesn’t provide right means then it will be difficult to manage all the activities.

3. Environment
Office should perform efficient and effective work for the good and effective management interior design, lighting, ventilation and cleanliness should be maintained. The location, government policy, customer should be managed. There must be proper working environment.

4. Purpose
In this element, office has to set up definite purpose. It has definite objective, personnel, means and other elements. It helps to provide guideline and direction to office activities. It helps in planning, organizing, staffing, directing, controlling, staffing and other office work etc.

Office accommodation and layout

Business Studies XI Notes — Sun, 18 Aug 2013 05:41:42 +0000

Meaning of office accommodation
It is the process of selecting appropriate building in a favorable location, establishing different sections and departments, proving or arranging resources in a scientific way. The purpose of office accommodation is to create sound working environment and to bring efficiency and rapidness in office work. It is important for both employees and outsider. Office employees spend a long time office. Bad accommodation can cause boredom and frustration among employees. Bad environment also may cause bad impression to outsiders.

Selection of office building

1. Shape and size of office building
It is one of the major factors that should be considered while selecting office building. It should have adequate space to accommodate all machines, equipment, and employee with furniture and enough space for flexibility. It should be considered taking the base of both present and future needs.

2. Lighting and ventilation
An office building should have adequate lighting and ventilation. It helps a lot to increase efficiency and enhance worker’s morale. Well lighted and ventilated accommodation puts less pressure on the employees and also reduces the physical and mental strain and consequently the efficiency is higher.

3. Convenience to customers and employees
While selecting office building it should consider the convenience of customer and employees. It should not be far from the related trade center, must have proper toilet and canteen services and food hospitality and utilities.

4. Cost
The cost of building effects on total budget of organization. The building purchased or built must be within the budget of organization. There should be balanced between requirement of space, capacity of the organization and the cost for covering the expanses.

5. Flexibility
Flexibility of office building in its shape and size should be considered while selecting the office building. It must also match the nature of organization.

6. Layout facility
The efficiency of men and machine depend upon the layout. The proper layout makes office attraction. For this furniture, machine and other goods are necessary. This also helps in the internal arrangement of office.

Selection of office location:

Nearness to customer: The office should be accessible to customers. They do not like long distances to make business inquiries. The office should be accessible to other parties who are in regular contact.
Nearness to related business: It is desirable to locate the office near the offices of related business. It should be established in the same line of trade.
Availability of infrastructure: The infrastructure should be available in office location. It consists of transport, communication, power, water and parking facilities.
Nature of business: The nature of business affects location of office. Office of manufacturing business in located near the source of raw materials, labor and service facilities. Office of trading and banking business is located in commercial centers near the customers. Office of perishable goods business is located near the market for such goods.
Availability of human resources: Needed human resources should be available for office. They can be skilled, semi-skilled and unskilled. All facilities must be available for employees
Environment: The office location should have healthy environment. It should not be near polluted rivers or waste disposal sites. It should be free from noise, dust and pollution.
Cost of space: Sufficient space should be available at reasonable cost for the office. Space should be available for future expansion.
Government laws: The selection of location should comply with government laws and regulation at national and local levels.

Office layout

Meaning of office layout
It is systematic arrangement of office amenities. It is arrangement of staffs, machines, equipment, furniture and other physical facilities within the limit of available floor space. Its purposes are to utilize space in the best possible manners, to make the outlook of the office attractive and to increase efficiency of the staff. It is defined as arrangement and placing of men, material, machines and money to the optimum level.

Main aims are

To utilize the floor space properly
To run the office work smoothly
To help for the motivation of person.
To help for the minimization of physical hazards and accident
To make proper supervision
To maintain the attractiveness for impressing the customers and visitor.
To try for the provision of comfort and satisfaction of employees
To help to provide security

Principle of office layout

1. Principle of flow of work:
It is the layout which helps for smooth and effective flow of office works. Simple, easy and prompt work flow and essential for work progress

2. Principle of free movement and observation:
Office layout should allow the free movement of employees. There should also be proper supervision and observation of works of movement too

3. Principle of effective supervision:
There should be free supervision of flow of works, movement of personnel, cost, wastage, balance of budget, quality of office works etc.

4. Principle of departmental relationships:
For the office layout related departments are inter related and those inter related departments should be placed side by side.

5. Principle of flexibility:
Office should be flexible enough to facilitate the expansion in the future.

6. Principle of maximum utilization:
As the time flows, there is increase in cost of every thing as per the situation of the economy if the country and the area where office is established. There are very fewer cases of deflation basically in developing countries. Therefore, when office is set up then there must be maximum utilization of employees, materials, space, machines and resources. There should be reduction of wastage.

7. Principle of pleasing appearance:
Interior design, lighting, ventilation and cleanliness should be maintained. Office must be well furnished and pleasing enough to make it attractive to all the customers and visitors

8. Principle of good ventilation:
Office must have enough doors, windows, and ventilation for constant supply of fresh air.

9. Principle of good lighting:
Office should try to provide natural light that is sunlight. Dark places should be avoided for establishment of office.

10. Principle of safety:
An office layout must be based on the safety. It should reduce office accidents like theft, fire, damage and so on. Office machine must be implemented properly

11. Principle of service facilities:
There must be provisions of good canteen, lights, lifts, telephone, and toilets.

12. Principle of providing private offices:
In an office. Separate rooms should be provided to some important employees. If the work is confidential in nature then private room should be provided. It is better to use movable partition to provide privacy

Steps in designing office layout:

1. Securing the blue print of the organization
It is the first step to secure the blue print of office building to know about the space available of office works. It should be secured from top management. Its blueprint is not available then the space should be measured and the sketch of building should be made

2. Assessing the need of the organization
Need of all department should be identified. Managers should consult the department heads to access space requirement. Number of employees, method and nature of works, equipment and machines. Present and future requirement should be determined. It is the second step of designing the layout

3. Arranging templates:
It is the third step in designing the office layout. The manager should prepare model known as template. Templates are thin plates of board or metal that represents actual space with decorations. They provide tentative design of office space. Several adjustments, change might me made before final model is finalized.

4. Indicating the electric wiring:
While designing the office layout, electric wiring should be properly managed. The location should be properly wired to avoid the risk of short circuits and fluctuation of voltage.

5. Submitting the plan to top management for approval:
After making plans and policies, it is submitted to the various departments. The plans must be discussed with the departmental heads and supervisors. They check the plans and finally approve it. Then only the plans are ready to be implemented

Concept of public enterprises

Business Studies XI Notes — Sun, 18 Aug 2013 05:41:42 +0000

Public enterprise is an organization which is owned, managed and controlled by the government. It is necessary for the active participation of government in individual and commercial level. It is financed and operated by the government. It provides service to the public. It provides goods and services to the public at reasonable price. It is guide by service motive but it can earn nominal profit. It helps in maintaining the state of ownership and operation of industrial, agricultural, financial and commercial undertaking. It is one autonomous body which is managed and owned by government and which provide goods/ services for public.

Types of company

Business Studies XI Notes — Sun, 18 Aug 2013 05:41:42 +0000

Types of company on the basis of incorporation

Chartered company
A chartered company is established by the royal charter or a special sanction granted by the head of the state. East India company, Hudson’s bay are the examples of this type of company. This type of company is no more popular today.

Statutory company
A company created by the special act of the parliament is called statutory company. Its objectives, powers and activities are defined by the act. Nepal Rastra Bank, Agriculture Development Bank, Nepal Industrial Development Corporation are some examples.

Registered company
It is formed under company act of the country. The working of registered company is governed by the provision of the company act. Himal Cement Company, Gorkha Biscuits Pvt Ltd is some examples.

Types of company on the basis of liability

Unlimited company
It is a company in which the liability of the members is unlimited like that of partnership firm. If the assets of the company are not sufficient for satisfying the claims of the creditors, the shareholders are liable to pay more than the face or nominal value of shares held by them even form their personal property.

Company limited by shares
A company limited by shares is registered under the provisions of the Company act with a specific amount of share capital divided into a definite number of shares. The liability of shareholders is limited to the extent of face value of the shares they have paid for. This type of company is quite common these days.

Company limited by guarantee
The company, under which each shareholder promises to pay a specific sum as guarantee at the time of winding up of company, is called company limited by guarantee. Such guarantee is specified in the Memorandum of Association of the company. The amount of such guarantee may differ from member to member.

On the basis of ownership

Government companies
A government company is a company in which no less than 51 % of the paid up share capital is held by the government

Non government companies
A company which is not a government undertaking is called non government company. Generally, company owned, managed and controlled by the private sector come under this category.

Types of company on the basis of number of members

Private company
A private company is a company which, by its Memorandum Of Association, limits the number of its members not exceeding 50 and prohibits the sales of its shares to the general public. A private company must use the words ‘private limited (Pvt. Ltd.) in its name.

Privileges of private company

Established by single person
Does not need to publish prospectus at the time of issue of its shares
It can refuse transfer of shares from one member to another.
It is not necessary for such a company to obtain the certificate of commencement of business before starting its business activities
It is not necessary to held statutory meeting.

Public company

A public company is a company which, by its Memorandum of Association, limits the number of its members not to be at least 7 and to open the boundary of having the maximum number of shareholders to the fullest. It doesn’t prohibit the sales of its shares to the general public but rather it allows collecting major capital by offering shares to the public. The public company is governed by the authorized capital with which is registered. The shares are transferable. A public company must use the word ‘limited (Ltd.) in its name.

Privileges of public company

Established by at least 7 promoters
Needs to publish prospectus at the time of issue of its shares
It cannot refuse transfer of shares from one member to another.
It is necessary for such a company to obtain the certificate of commencement of business before starting its business activities
It is necessary to held statutory meeting.

Importance of record management

Business Studies XI Notes — Sun, 18 Aug 2013 05:41:42 +0000

1. Preservation of record
It helps in management and control of important records. It helps to protect necessary records with care and disposes useless records.

2. Evaluating progress
It helps in evaluating progress of organization. It helps in preservation of history of organization. The past records show direction to organization. It helps in finding out the weakness and strength of organization. Record management gives the account of progress and direction in which organization is going on.

3. Facilitate comparison
Record management helps to evaluate business progress and performance. It helps in comparison between one period of time and another or between same times of business

4. Helpful in decision-making
Records are the memory of business. It is useful for future decisions making process. The study of past records shows direction for future. It supplies information to organization whenever it is needed. Therefore, it helps in taking decisions.

5. Efficiency in operation
Record management helps to provide required information with speed and accuracy. It helps to make office work efficiently and effectively. It helps to increase efficiency of the office.

6. Evidence
Records acts as an evidence in the time of dispute. It is important for the settlement of dispute. It can be shown as proof in court.

Concept of record management
Record management is the area of office management which deals with the maintenance of records of organization. It is very important for management for control of records. It is an art of handling and maintaining office records from the time of creation to disposal. The records are systematically maintained to preserve for future use. Record management refers to the activities designed to control the life cycle of a record.

Stages of record management

1. Creation of records
It is the first stage of record management. It is the most important stage. In this stage records are either created inside the organization or are received from outside the organization in form of letters or notices.

2. Storage of records
It is the second step of record management. Once records are created they must be retained or protected. This stage is also known as retention of records. It is the preservation of records for future reference. The records are recorded in such a way so that it can be easily located in the required time.

3. Use of records
It is the third stage of record management. In this step the stored records in the past are used for planning, organized, deciding, and preparation of accounts and so on.

4. Disposal of records
It is the fourth and last stage of record management. Records cannot be stored forever. Outdated records must be destroyed or disposed.

Concept of business communication

Business Studies XI Notes — Sun, 18 Aug 2013 05:41:42 +0000

Meaning of business communication

The word communication is derived from the word “communis” which means to inform or tell information. Communication is the process of transformation of information from one person to another. It is a process of exchanging opinions ideas, feelings, information, views and other fast between or among two or more people. It involves the systematic and continuous process of telling, listening and understanding. Communication skill means conveying the message to others and understanding the message from others. Business communication is a bridge of passing information between the management and the employees.

Sources of office information : internal and external

Business Studies XI Notes — Sun, 18 Aug 2013 05:41:42 +0000

Internal communication
All the communication that takes place in carrying out works and tasks within a business is known as internal communication. It is helpful for office works. This is the communication that takes place among the business managers, employees and workers to create, implement and to make plans. It helps to maintain coordination. It is classified into inter departmental and interdepartmental It includes letters, memos, reports, announcement, circular etc.

External communication
When people of one organization transmit information to the people of other organization, then that communication is called external communication. It maintains good relationship with outsiders such as supplier, customers etc. It is very important for the business. It is classified into two types: Inward communication and outward communication.

Types of cooperative organization

Business Studies XI Notes — Sun, 18 Aug 2013 05:41:42 +0000

1. Producer co-operatives: Some co-operatives process and market their members’ products and services directly while others may also sell the input necessary to their members’ economic activities. Examples: Agriculture co-operatives, pooling of equipment, advisory services, etc.

2. Multi-stakeholder co-operatives: The membership of these co-operatives is made of different categories of members who share a common interest in the organization. Examples: home care services, health services, community services, etc.

3. Worker co-operatives: The purpose of these co-operatives is to provide their members with work by operating an enterprise. The co-operatives are owned by their employee members. Examples: forestry, leisure, production and manufacturing, tourism, communications and marketing, etc.

4. Worker-Shareholder co-operatives: These are incorporated co-operatives that hold partial ownership of the business in which the co-op’s members are employed. Because of its share capital, the co-operative may participate in the management of the business and the workers may influence work organization. Examples: production and manufacturing, technology, etc.

5. Consumer co-operatives: They provide their members with goods and services for their personal use. Examples: Food, credit unions, housing, insurance co-operatives, etc.